Chevron's Fracking Project - In the Name of CSR?

Corporate social responsibility (CSR) has been viewed somewhat as an oxymoron by researchers in academia and by civil society. CSR is more often seen as a PR campaign tool for corporations rather than a genuine commitment to improving life quality, protecting natural resources from depletion, or for the sake of sustainable and social development. So what do we need CSR for?

Corporate social responsibility is often used as a PR compaign tool for corporations rather than a genuine commitment to sustainability.

Shale gas exploration through fracking is a process that can endanger the environment through air and water pollution and methane emissions

Social response is crucial because it reflects the social interpretation of the matter, and law creation resembles an organic process, it grows and develops along the societal beliefs and its ethical principles.

Success in halting big corporate projects may indicate a change of mindset in the future, being more assertive about one’s rights: right to free speech and expression and the right to safe, clean, healthy, and sustainable environment.

Looking at the activities of some large corporations around the world, one cannot help but wonder why we keep maintaining this debate on CSR in the face of stark evidence of corporate harmful behaviour, or why the business sector still clings to it, in spite of popular disbelief in CSR. As tempting as it may be, it’s not the goal of this short article to attempt an answer to these questions, but rather to discuss the imbalanced power relations between major business organizations and society at large.

CHEVRON AS AN EXAMPLE OF CSR

But first let’s look at one example of a large corporation defying ethical norms through both conduct and object of their operational activity: US energy group Chevron’s shale gas exploration back-door deal with the Romanian government in Pungesti, a small village in the east of Romania, which has led to massive solidarity protests in the capital city, Bucharest, as well as in major cities abroad, where the Romanian community has been actively involved in spreading the word on the dangers of fracking [1].

Protesters in Europe opposing shale gas exploration through fracking argue that the process can endanger the environment through air and water pollution and methane emissions, among others, and some countries in Europe have banned it altogether (e.g. France and Bulgaria). The mass movement against fracking has been adopted in Romania by the national Save Rosia Montana campaign, fighting against the largest cyanide based mining project in Europe, a campaign that now symbolizes citizens’ resistance against corruption and irreversible destruction of precious natural resources, and along with it, of people’s livelihoods. Pungesti village has been protesting for weeks against Chevron’s project, and people even camped there to stop the corporation’s trucks from installing their fracking equipment.

For a while, Chevron seemed to back down and even declared it would suspend its operations in Pungesti in the face of thousands of protesters around the country. The news that ignited wide public consternation among Romanians worldwide came last Monday, when the Romanian government led by Prime Minister Victor Ponta authorized a violent intervention at 4am in Pungesti in order to disperse protesters and to allow Chevron’s trucks to go through according to the plan, while at the same time cancelling the media’s access to the site. It is said that locals turned overnight activists have been beaten by the Romanian police troops and forced to leave their protest camps, while Chevron built a new access road and erected a metal fence around its drilling site soon afterwards.

Approached by the UK newspaper The Guardian in connection to these events, Chevron replied: "The company is committed to building constructive and positive relationships with the communities where we operate and we will continue our dialogue with the public, local communities and authorities on our projects."

In search of a practical glimpse at their commitment to dialogue and social well-being I came across their corporate website, which communicates a CSR investment worldwide worth about USD 1.2 billion.

So coming back to my previous argument on CSR, I could pose the question how this really works, and more importantly, for whom. As for “how”, I personally believe it doesn’t really work, at least not in a way to please everyone, because there are too many trade-offs in the process and one corporation cannot, indeed, save the world on its own; we all need to join forces and change has to lead by example, from all actors in society. But I also think corporations should not add more to the environment’s destruction either.

As for “whom”, as long as their balance sheets are on the positive and profits are rising, however cynical the argument may be, I see only corporations winning. Of course the government officials will win something in return of their approval to this deal, and probably the locals will receive some crumbs too, but in the long run we seem to lose so much more. Economic development cannot justify poisoning water supplies and endangering the health of those communities. Or does it?

CSR HAS FAILED THE GLOBAL COMMUNITY

Looking at Chevron’s press declarations, and reading about their corporate responsibility endeavours, and facts, I am puzzled. What are CSR and business sustainability really about? Authors Peter Flemming and Marc Jones have recently made the case that CSR has failed the global community and what got achieved instead were large corporations setting a dominion in world’s affairs. Their argument rises from a thorough analysis of the economic politics leading to the creation of the CSR concept in business management, and the thesis they pose is that CSR reconciliation with the purpose of the firm, making a profit, is more a myth than a proven reality.

Another aspect that is interesting regarding the corporation’s “environmentally unfriendly hegemony” is its status in relation to the national state as source of regulation, which is reflected in the lack of hard regulation. Existent laws and rules regarding social and environmental sustainability are more of a soft nature, based on volunteering on the part of the corporations. As argued in my master thesis, issuing regulation on sustainability is dependent, however, on multi-stakeholder decision-making, since the command-and-control era is no longer valid procedure in today’s society, and societal actors are demanding a role in the law-making process. Therefore, influencing corporate behaviour is largely dependent on social response (e.g. civil society, consumers etc), which gives corporations their license to operate. The social response is crucial because it reflects the social interpretation of the matter, and law creation resembles an organic process, it grows and develops along the societal beliefs and its ethical principles.

CHANGE IN ATTITUDE?

Going back to the Romanian example, the social response has manifested itself in the form of mass protests against various projects endangering the environment and human welfare. As mentioned in my article Roșia Montană, More Precious Than Gold, success in halting big corporate projects may not be the main benefit in the long-run, but rather the ongoing debate on true well-being and maybe a change of mindset in the future, being more assertive about one’s rights: right to free speech and expression and the right to safe, clean, healthy and sustainable environment.

It is not the purpose of this piece to shout against businesses with a sustainability agenda; as the latest Worldwatch Europe report on Business Innovation in a Living Economy has shown, companies of all sizes cannot heal the world’s problems on their own, and systemic change is crucial in moving things forward. But a change in attitude may help a great deal, and those managers who understand and apply a different mindset to doing business are leading the change process in their organization based on their own example, proving that changing things for the better is a matter of will and perseverance.If this sounds to you like the classic tale of large corporations being backed up by ill-fitted governments in making huge profits at the expense of the environment and people’s livelihoods, you might actually be right. In a nutshell, Roşia Montana (Red Mountain) represents a battle field where corporate interests, backed up by local politicians are opposed by the remaining few residents of Roşia Montana, supported by tens of thousands of citizens across the country and a few hundred more abroad. The stakes are high: the price of gold is debated on the streets – the real price, that is.